Strong labor market has more Americans quitting their jobs

U.S. companies added 177,000 employees in June — further evidence of a workforce increasingly willing to seek greener pastures as businesses struggle to find and keep qualified workers.

Last month's hiring was led by employers with more than 50 workers, accounting for 84 percent of the job growth, according to a report released Thursday by the payroll processor ADP.

The education and health sectors topped the increases by hiring 46,000 workers. Leisure and hospitality companies contributed 33,000 jobs, as did professional and business services businesses.

The ADP figures come a day before the government's monthly jobs report, with economists expecting Friday's numbers to show the economy added 195,000 jobs and the unemployment rate holding at 3.8 percent.

The job growth that has come along with an economic expansion now entering a 10th year is making it harder to find capable employees. "Business' No. 1 problem is finding qualified workers, Mark Zandi, chief economist at Moody's Analytics, said in a statement. "if sustained, this problem is set to get much worse. These labor shortages will only intensify across all industries and company sizes."

Change by Company Size
ADP, LLC, Moody's Analytics, BLS

Even as employers struggle to hire workers, wages remain stagnant. Average hourly pay has held flat for the past year after adjusting for inflation, according to the Labor Department.

Meantime, American workers are quitting at rates not seen since the dot-com era, according to a story in the Wall Street Journal, which cited government data as showing 3.4 million quit their jobs in April, close to a 2001 peak and double the 1.7 million workers given pink slips during the month.

The decision to quit and look for better paying or more satisfying employment can be rewarding, as employees tend to get their largest pay increases when they job hop. About 30 percent of those switching jobs in May netted larger pay checks than those who stayed put, according to the Federal Reserve Bank of Atlanta.

The willingness to look for better pay and working condition has some businesses catering to employees in a way they might not have considered in years past.

Derek Volk, the president of Volk Packaging in Biddeford, Maine, told the Wall Street Journal he recently let a worker push back her start time due to a day-care issue involving her dog.

"A few years ago, that would have been a ridiculous ask, but now you have to be flexible," he told the newspaper.